Question: Can I get a home equity loan while in a debt management program?
I just entered a debt management program to get control over my credit card debts. I have done this separate from my husband so that only my credit is affected.
Just after I entered into the program, my husband started showing interest in a home equity loan to consolidate his credit card debts and vehicle loans, and do home improvements.
In our marriage I am responsible for my own debts, but I am wondering if being in the DMP will affect the chances of us obtaining the home equity loan.
Serious educated replies will be very much appreciated.
{ 3 comments… read them below or add one }
It depends on what kind of DMP you are in….is it a consumer proposal?? or did you just get a debt consolidation loan at the bank?? It also depends on your credit rating. If both parties still have good credit and aren’t in a consumer proposal then yes there is a good chance that you can still get a home equity loan. This is what I do for a living….I’m a mortgage broker. I hope this helped
In a lot of cases, being in a DMP may preclude you from getting additional debt because some lenders view it as a precursor to bankruptcy.
The fact that this is a secured loan might help, but you’d need to check with the lender.
If the home is in both of your names, the HELOC would need to be jointly titled as well.
One option to consider is exiting the program and increasing the amount of the HELOC to cover your debt as well – and use the equity in your home to pay down the debt instead of the DMP.
he can open equity line of credit only in his name and this way your credit report will not affect his change to obtain the loan or you have to get this loan fast- before your debt consolidation program will show on your report. most lenders treat debt consolidation program like bankruptcy chapter 13, so it is mean- they don’t like see this very much.